Fitch Ratingson Oct. 4 assigned an insurer financial strength rating of BBB- and a national scaleinsurer financial strength rating of AA- to both Afianzadora Aserta SA de CV and Afianzadora Insurgentes SA de CV, with a stable outlook forboth ratings.
The two companiesare both subsidiaries of Grupo Financiero Aserta SA de CV, and together make up98% of the parent company's total assets. They have a combined market share of 26%in Mexico's surety bond market, Fitch noted.
In assigningthe ratings, Fitch said that it believes both Afianzadora Aserta and AfianzadoraInsurgentes' leverage metrics are adequate, as the pressure on their capital iscaused by Mexican regulations that require ample provisioning. Grupo Aserta alsohas a "generous" dividend policy, the rating agency said.
Both companies'efficiency levels have remained stable and competitive as of June, as AfianzadoraAserta had an operating ratio of 59% and loss ratio of 20%, while Afianzadora Insurgenteshad an operating ratio of 71.6% and a loss ratio of 12.4%, the rating agency said.
Fitch notedthat both companies' reserves to earned premiums ratio are in line with the localaverage, but are greater than the regional average, due to stricter regulatory requirementsin Mexico.